ABC issues news releases on the latest workforce, policy and industry issues, as well as construction-related economic data and trends. Commercial and industrial construction economic analyses include federal data on construction spending, employment, GDP and the Producer Price Index, as well as state-by-state construction unemployment estimates.

In addition, ABC produces the Construction Backlog Indicator, the only economic indicator that reflects the amount of work that will be performed by commercial and industrial construction contractors in the months ahead, and the Construction Confidence Index, a diffusion index that signals construction contractors’ expectations for sales, profit margins and staffing levels. ABC construction economic releases are published according to this schedule.

Construction Contractors Regain Confidence in January 2019, Says ABC

WASHINGTON, March 21—Construction industry leaders remained confident regarding the nonresidential construction sector’s prospects during January 2019, according to the latest Construction Confidence Index released today by Associated Builders and Contractors.

Expectations for sales during the coming six-month period remained especially upbeat in January, with nearly 70 percent of respondents anticipating an increase in sales levels. A similar level of confidence characterizes contractors expectations on future staffing levels, with fewer than 7 percent of contractors indicating expectations of shrinking workforces.

While contractors became fractionally less confident regarding profit margins, more than half of respondents still expect their margins to increase in coming months, while less than 13 percent expect margins to shrink. All three principal components measured by the survey—sales, profit margins, and staffing levels—remain well above the diffusion index threshold of 50, signaling ongoing expansion in construction activity.

The CCI for sales expectations increased from 67.2 to 68.4 in January.

The CCI for profit margin expectations fell from 60.6 to 60.5.

The CCI for staffing levels increased from 66.2 to 68.2.

“Indications of ongoing confidence in the construction sector have become more important," said ABC Chief Economist Anirban Basu. “Recent dips in consumer and small-business confidence have become a source of concern, as have weak reports regarding employment growth and retail sales. Thankfully, contractors continue to exhibit elevated levels of confidence regarding the near-term trajectory of the economy despite ongoing workforce shortages. Not only do contractors expect to further expand staffing levels, many continue to expect rising profit margins despite rapidly expanding payroll expenses.

“One source of relief has been a recent moderation in construction materials prices,” said Basu. “With the global economy continuing to soften, materials prices should remain well-behaved over the months to come. Investors continue to aggressively seek ways to deploy capital, including on new commercial construction. This helps explain a recent surge in the Architecture Billings Index, another leading indicator that, along with CCI, suggests ongoing economic momentum throughout the first half of 2019.”